NY Trader Expo 2016 - Day 1 Highlights

Day 1 Highlights

I attended Day 1 of the NY Trader Expo. I've been going to this for nearly a decade. Generally the first day of the conference is very lite and is mostly sponsor talks. It still is sponsor talks. Fidelity has an entire day of sponsor talks. This year seems to have more tracks on the first day. There is a FinTech Symposium (more on this later) and a options strategies track.

I went between the FinTech symposium and the Options track.

FinTech Symposium

Welcome to the Future - Meet the Visionaries Using Technology to Change Everything About the Way You Trade

"Technology is sweeping the financial world, transforming how money is stored, moved and spent. Trading is no exception. Hear from entrepreneurs picked from the Forbes Fintech 50 list who are re-imagining the way you research and place your trades, and even how the open market executes them. "

I learned and was introduced to Motif investing. One can view it as having the ability to invest and create a portfolio of stocks based on any type of allocation or theme you want. Imagine you're your own hedge fund. This could be a disruptive technology. Let's say you have a few thousand dollars and want to invest in a pool of stocks, with Motif investing you can do that as one trade and allocating fractions of shares of a stock.

Hardeep Walia is the ceo of Motif. He is a former microsoft executive and his company is based in silicon valley. He made an intesting anectode about why there hasn't been more innovation in finance from tech companies or disruptors like Uber did for Taxis, which is the immense regulations in finance. He spends a significant amount of his time dealing with regulators. I can certainly see that the heavy regulation may deter more tech innovation in the finance/ trading world. 

He also had a bold prediction that the trading industry will in the next few years have trading fees drop near zero. This is certainly a trend and I've seen ETF fees come down and there are a few without any fees.

Social is a key part of Motif's business.

There was also a representive from IEX. They were featured in Michael Lewis' book Flash boys.  They want to slow quotes down by about 350 milliseconds so that everyone can get the quotes at the same time. They don't want to have their business model be based on charging for data, but rather commission on trades.

During Q&A, an audience asked about whether bitcoin or block chain technology can reduce transaction costs.

Audience asked about whether bitcoin can reduce transaction costs. Here is an article on bitcoin technology.

The Truth About Stock HFTs to Increase Options Profitability

Sun., Feb. 21 • 1:30 pm – 2:15 pm FAUSTO PUGLIESEMost trading instructors teach the same tired, old trading tools: chart patterns, and technical indicators. Unfortunately, the high frequency trading era has diminished the usefulness of these tools because many of these techniques are already factored into algorithmic trading models. Fausto Pugliese's trading model is different because it looks directly at supply and demand conditions in the market and allows traders to actually spot powerful upcoming moves by trading with the "smart money" players such as market makers and hedge funds.

• If you take the VX futures the slope in general is sloping up the farther you go out in time, which is bullish.

• “Normal:” $VIX < $VXV 

• But when $VIX > $VXV = oversold! Go long when $VIX again < $VXV

The last event of the evening was a discussion about futures.

You will learn how to:• Develop skills that will enable you to follow the dominant market makers. • Distinguish which brokerage firms control the most shares. • Understand and identify the difference between the variety of Electronic Communication Network vehicles like ARCA, NDSQ, EDGX, and more.• Follow the ECN Book/Total View to see where most of the shares are looking to be bought or sold from other traders. • Use time and sales to gain insights into a stock's supply and demand situation.

Note to self: Create an alert in the TOS platform when VIXVXV

 Next, I went to the options track to hear a talk by Fausto Pugliese from Cybertrading university. I've heard Fausto talk years ago through the ThinkorSwim Tuesday guest chats. He is known more for teaching day trading of equities, but with this talk he tried to tie in some option discussion.

He premise is to day trade inexpensive stocks (less than $10). You would make 50cents on a 1,000 shares and make your $500 for the day or $2,500 a week and over six figures in a year. That sounds very appealing. The question is how do you find these stocks to trade? He suggest looking at the top movers for the day and using Level III quotes to to identify large blocks of trades to determine the support and resistance levels.

Disruptive New Fintech & Media Tools for Active Traders. This panel will take a look at the new institutional-quality financial tools, research sources, and technologies that are providing retail traders with unprecedented capabilities to compete with professional traders. LEIGH DROGEN, JEFF JOSEPH, DAVID KEDMEY, RISHI SINGH

The panelists have created several different companies. Tiingo is a company that provides data a financial portal where you can pay as much as you want.

Estimize is crowdsourced earnings and economic estimates. The CEO claims that there estimates are more estimate than those on Wall Street and they have announced a deal with CNBC to use their data for earnings estimates.

Eidosearch  is using big data to run simulations and scearios on events that is happening and looking back at data to find similar patterns to determine what happens after this pattern.

The Current Status of Option-Oriented Indicators

LAWRENCE MCMILLAN Option data (price and volume) can often be used to structure trading indicators or systems designed to predict the movements of the broad stock market. In this session, Larry McMillan will review the prominent ones (put-call ratios, volatility indices such as VIX, etc.) and bring you up to date on what these indicators are "saying" at the current time.

Looking at the vix futures if they slope upward->bbullish normally slope up 

I've been to many of Larry's talks in the past. He always incorporates recent market moves and incorporates his options analytics to give his audience his view on where the market is going.

Here is my key takeaways:

Larry's view on the market: The SPX needs to go above 1950 then bullish otherwise bearish 

An Exclusive Event for Futures Traders

JIM IUORIO

SCOTT NATIONS
Don't miss this exclusive event hosted by industry experts Scott Nations and Jim Iuorio. They will share their personal insights and expertise on issues that will affect the futures market. Sponsored by the Futures Institute.

I didn't get too much out of this. They introduced why futures are a great trading product and discussed the different futures products from indexes, commodities, FX, and Interest rates.